Battery Supplier Issue Plauges Saturn, GM Hybrids

TheCarConnection reports that troubled battery maker Cobasys threatens to continue to limit the availability of Saturn and General Motors hybrid vehicles. The 2008 Saturn Vue and Aura Green Line hybrids, as well as the Chevrolet Malibu hybrid, use Cobasys' nickel-metal-hydride batteries. The company is also one GM's key suppliers for its new 2-mode hybrid models.

According to the TCC report, Cobasys – which is a joint venture between Energy Conversion Devices (ECD) and Chevron – are "locked in legal battle over the battery company, which is technically out of money." The company reportedly lost more than $76 million in 2007 and is anticipated to lose more than $82 million this year. "In the SEC filings, ECD also said Cobasys needs more than $92 million for operations this year, but its board, which is controlled jointly by ECD and Chevron," wrote TCC, "has not approved a spending plan because the owners couldn't agree on the 2008 budget."

Sources told the online auto publication that the issue has resulted in GM putting Cobasys on its "distressed" supplier list. GM spokeswoman Deborah Silveman would not comment on the dispute.

TCC said that the battery maker also holds a key contract with GM on the development of the much anticipated Chevrolet Volt. Silverman wouldn't provide any specifics. "I can't get into the details of our relationship with Cobasys," she told them. However, to ensure a smooth launch of its first 2-Mode hybrids, TCC says that "General Motors has opted to buy the nickel-metal hydride batteries for its new two-mode hybrid, such as the Cadillac Escalade, from a Panasonic-Toyota joint venture."

Source: TheCarConnection

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